Broadcom Inc. (NASDAQ: AVGO) stock remained under pressure near $326 this week despite new agreements and the company's AI chip sales guidance. Technical indicators point to continued weakness, with traders watching whether shares can hold support near $320 next week.

Broadcom Stock Faces Selling Pressure

The daily Moving Average Convergence Divergence (MACD) indicator, which tracks momentum by measuring the relationship between moving averages, is flashing a sell signal. The Commodity Channel Index (CCI) stands at -111.83, placing it in oversold territory — readings below the -100 threshold are conventionally treated as oversold, though such conditions can persist for extended stretches during a downtrend. These readings reflect selling pressure rather than a renewed decline.

Bull/Bear Power also indicates weak buying demand, while the Relative Strength Index remains neutral. Weekly price volatility reached .75% over the period. Taken together, the readings describe mixed conditions, although the short-term technical picture still favors sellers.

NTT DOCOMO Deal Expands Cloud Business

Broadcom announced a 10-year agreement with Japanese telecom operator NTT DOCOMO, the mobile carrier unit of Japan's NTT Group, to upgrade the carrier's private cloud systems. The partnership uses VMware Cloud Foundation — Broadcom completed its acquisition of VMware in late 2023 — to support security, reliability, and faster service delivery. Financial terms were not disclosed. Multi-year commitments of this kind are central to Broadcom's software strategy, since VMware Cloud Foundation is now licensed on a subscription basis and long-term contracts provide recurring revenue visibility.

The agreement follows a recent report on Broadcom's cloud partnership. Separately, the company has introduced Arcot Scam Defense, a fraud protection product. Neither announcement has yet reversed the share weakness described.

AI Chip Outlook Remains Strong

Broadcom expects quarterly AI semiconductor sales of $21.7 billion, supported by long-term customer commitments. The figure represents management guidance rather than completed sales, and the company's acquisition-related cash generation and debt reduction remain distinct from its share price.

Earlier reporting examined Broadcom's AI revenue and valuation concerns. Demand for custom processors continues, but large data center projects require significant funding and infrastructure, and those costs affect growth forecasts. Custom silicon has also become a distinct track in the AI chip market alongside merchant GPUs from vendors such as Nvidia and AMD, as large cloud operators look for accelerators tailored to their workloads.

Traders Watch $320 Support Next Week

The technical outlook places the projected weekly trading range between $320.24 and $333.62. Immediate resistance sits at $328.69, while the Ichimoku Kijun — a momentum-based support and resistance reference — stands higher at $354.74, well above the current trading area. These levels identify possible price barriers rather than guaranteed outcomes.

The model cited in the analysis assigns a 77% probability to a decline and a 23% probability to an increase, though its calculation method was not provided. A close below $320.24 would strengthen the bearish case, while a sustained move above $328.69 could weaken it.

Recent coverage of the wider AI chip market offers context for Broadcom's growth plans. However, the next confirmed price move will depend on trading activity rather than company forecasts alone.

Source: Blockonomi